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An equity share is a basic term that associates with a company. Let us begin the article by knowing the meaning of equity shares and Importance of stock broker.

What are Equity Shares?

Equity shares are also termed as ordinary shares of the company. The holders of equity shares have the right to vote in the meetings of the company. They are the real owners of the company. The dividend payment is first made to preferential shareholders and later to equity shareholders. However, the right to control and manage the company lies in the hands of equity shareholders.

Let us have a look at some of the features of equity shares.

Features of Equity Shares

• They bear the highest risk as they are the owners of the company.
• They can be transferred from one person to another with or without any consideration.
• They are permanent in nature.
• The rate of dividendis not fixed for equity shareholders.
• They manage the affairs of the company.

Let us now have a look at some of the advantages of equity shares.

Advantages of Equity Sharesfrom Shareholder’s Point of View

• Equity shareholders are the real owners of the company and have the voting rights.
• During profits, equity shareholders gain a lot in the form of higher dividend and increase in the value of shares.

Advantages of Equity Shares from Company’sPoint of View

• They can be issued without mortgaging or creating any charge on the assets of the company.
• There is no obligation to pay adividend on equity shares. Dividend needs to be paid only if there are profits.
• It is the permanent source of income for the company that needs to be repaidonly at the time of liquidation.

Conclusion

Trading and investing in equity shares is hugely popular. Stock broker Indira Securities provides all financial services related to equity shares. Our clients can avail our services by applying for an IPO or investing/trading in equity markets. Open a demat account with us and we will help you in identifying growth stocks for your portfolio. If you have any query, you can reach us via call or email.

Every country has its own stock exchange to buy and sell securities. And If you want to buy stocks, you will almost always need a Stock broker — essentially, a middleman — to place those orders on your behalf. All such exchanges work on a given set of rules and regulations to abide by while trading. Different countries have different time zones, currencies, and many stock exchanges within themselves. For example, India has around 8 notable exchanges and several other small scale exchanges. Having a centralized domestic governing body is very important for the smooth functioning of such exchanges.Therefore, it is important to bring into existence a regulatory body to control their financial and investment trade markets.

In India, the governing body of stock exchange is the Securities and Exchange Board of India (SEBI). It looks after all such functions that bring unified operation and coordination of these domestic financial markets with each other.

SEBI was established in the year 1988. It was assignedthe role of governing and regulatory authority only on the 12th of April, 1992, through the SEBI Act (1992). In 2005, it became a statutory body after the changes made to the original Act. The SEBI head office is located in BandraKurla Complex Business District in Bandra East, Mumbai. There are regional offices present in the Eastern, Western, Northern and Southern zones of the country as well.

Management Team of SEBI:

The Board management is made up of its own members. It consists of 8 members:

A Chairman- Nominated by the Union Government of India
2 officers- Members of the Union Finance Ministry of India
1 member of the Reserve Bank of India
5 other members- As nominated by the Union Government of India
Powers of SEBI

SEBI has three ultimate powers namely:

Quasi-Legislative Powers- The right to draft regulations through the SEBI Act.
Quasi-Judicial Powers- The right to pass new orders and rules.
Quasi-Executive Powers- The right to independently examine and investigate; and the right to take action as they deem fit.
Note: Though SEBI has such vast powers, the Securities Appellate Tribunal and the Supreme Court of India looks over the functions and its consequences constantly. Major changes have to be passedthrough the two aforementioned bodies before being adopted.

Objectives of SEBI

Mentioned below are the main objectives of SEBI:

Protection- Protection of the interests of investors in securities and to promote the development of, and to regulate the securities market and for matters connected there with or incidental thereto.
Competitive and Professional objective: To regulate healthy and professional competition among merchant banks, agents, etc by designing and implementing a uniform code of conduct.
Prevention of trading malpractices.
To balance statutory and self regulatory functioning of the securities industry.
To promote orderly functioning of all securities exchanges in the country.
Functions and Responsibilities of SEBI

The preamble of the SEBI Act lists all the functions of the regulatory body in detail. The SEBI has three main functions; protective, developmental and regulatory functions.

Following are its functions and responsibilities towards different parties.

Protective Functions
Prevention of insider trading and prohibits the management, directors or promoters from making profits by sharing sensitive insider information.
Promotion of fair trade practices.
Prevention and detection of fraudulent and unfair trading by keeping a check on price manipulation and tricking investors by providing false or misleading information.
Educating Investors through campaigns, conducting seminars and publishing bulletins.

Developmental Functions
Training and development of intermediaries.
Research activities- Conducts research that is useful to all trading participants and publishes journals available to the public.
Fair trade through making underwriting optional.

Regulatory Functions
Performing its duties and exercising the powers delegated to it by the Government through the Securities Contract Act, 1956.
Compulsory registration of merchant banks,stock exchange brokers, sub-brokers and agents.
Notifications of rules and regulations for the smooth functioning of all the intermediaries present in the market.
Regulation of Investor Schemes such as mutual funds.
Levying of penalties, charges and fees as and when necessary.
Prohibition of unfair trade practices.
Conducting inquiries and inspections through stock exchange audits.

Conclusion

The SEBI in many ways acts like a parent to all the stock exchanges and securities industry of the country. By performing its daily functions, it promotes healthy trade relations with foreign and domestic investors. The reason for the establishment of this governing body was heavy interest in investing from the public and severe malpractices conducted in the past to dupe the investors. True to its words, SEBI has managed to handle one of the most lucrative trade markets of the world. Bombay Stock Exchange and National Stock exchange are the most important trade centres of India. Read more about the BSE and NSE in our article “What is The Difference between BSE and NSE”?

Indira Securities is dedicated to help our investors learn more about the Indian stock market and if you want to Open Demat Account we will provide you free Demat services and life time free research calls. We’re always at your service and just a click away. We wish you luck on your trading journey.

Indira Securities is one of the reputed stock broker in India. TradeInsta i.e. our mobile trading application is one of the best in the market. Our application facilitates smooth and hassle-free trading and investing experience. Below are some of the features of the mobile application that makes it appealing for our clients.

Key Features of TradeInstaMobile Application

• Live Market Overview

With TradeInsta mobile application you can have access to the live market. You can see the live streaming of prices of stocks and commodities. You can even see the market depth and other significant information about the stock on the application.

• Scanner

The scanner feature of the mobile application facilitates analytical study of the stock. Here you have access to the fundamentals and technicalsof the stock. It helps you analyse the performance of the stock and make smart trading and investment moves.

• Fundamental and Technical Score

By using TradeInsta application, you can know the fundamental and technical score of a stock. The stock with a good score means that you can purchase it in your portfolio. While the stock with a lower score are weak in nature.

• Notes

This feature of the application allows you to post comments about the financial market. You can keep your notes private or share with everyone on the forum. Moreover, it also helps you get insights from other traders and investors on your query or comments.

• News and Announcement

This feature of the TradeInsta application gives you access to all the news and announcement related to the stock market and economy. In addition, you can see the specific news and updates about a stock as well.

• Charts

Charts are of significant importance to the traders. TradeInsta application gives you access to charts of the stock and helps you take informed trading decisions. You can read the charts and determine the future movement of the stock price.

• Research Calls

TradeInstaapp regularly provides trading and investing calls to the clients. This helps them in making money on intraday basis and also building a healthy portfolio.

The above mentioned are a few features of the TradeInsta mobile trading application. If you want to open demat account you can click on this link.

You can download our TradeInsta mobile application from the below mentioned links.

Android users: http://msg.mn/indiraapp/

Stock market trading often seems complicated and risky. This isn’t entirely true. It is a serious commitment which needs focus, nurturing and constant updating of knowledge. Stock broker help you to build take care of your portfolio for your better future. We usually come across several stories of how a person made a fortune or was brought to the streets due to bad investment decisions. Whether you are experienced or new to stock market trading, here’s a concise list of 10 trading mistakes to avoid for long term success.

1. Ignoring Your Homework: One cannot emphasize enough on the importance of doing their homework, i.e. research. As a trader, the worst mistake made is not researching enough. This is necessary as novice traders have neither the knowledge nor experience of seasonal trends, timing of data releases; and trading patterns that occur in the trade circle. The urgency to start trading often blinds the need to do some research at the beginning and that can cost a very high price.

1. Straying From Your Trading Plan or Not Planning At All: Starting your trade without adequate knowledge of the stock marketis just like diving into quicksand headfirst, something which results in drowning. Successful traders always have a well-defined plan to trade, which they do not stray from. For example, how much capital they are willing to put at stake, the losses they can afford to bear, their entry and exit points in the market, etc.

1. Having Too Much Faith in Financial Media: None of the financial media based channels can help you get closer to your goals. Beginners often assume that financial media is the way to go in order to keep a track and learn more about their investments, which is often contradictory. Nobody would revealhow to invest in a stock market on a TV channel if they actually were profitable. Refer to daily or monthly newsletters, which is way more productive and educational.

1.   Not Minding What or How You Leverage: Leverage is the strategy of using borrowed money to increase return on an investment. Beginners are often jazzed by how much leverage they possess but don’t understand the phrase “leverage is a double-edged sword” till they learn it the hard way. Leverage is known to increase profits exponentially and diminish your capital to mere pennies through losses.

1. Not Implementing Stop Loss Orders: Stop loss orders are the instructions given to a broker for buying or selling securities in order to cap the losses caused. Stop losses are important for successful trading and not implementing these can be one of the biggest mistakes a novice trader can make.To learn more about stop loss, refer to our blog ‘Importance of Setting Stop Losses’.

1. Averaging to Recover Losses: Some of the biggest trading disasters can occur when a trader keeps on adding stocks to breakeven his losses. This sort of averaging down eventually forces him to give up his entire position when the losses incurred makes it imprudent and impossible to hold on to that position. Traders also average up because the security advancing is equally tempting but at the same time, it carries high risks.

1. Becoming a Part of the Sheeple: Traders usually fall into the trap of following the herd when it comes to investing. They end up paying a price too high for hot stocks or initiate short positions for drowning stocks. They don’t usually understand when to exit a trade. We at Indira Trade provide one-stop stock market investment advice and help you to trade better as well as maximize profits.

1. Obsessing Over Performance: The desire to make better investments and doing better in the market grips almost everyone. Traders often fall into the trap of high performing stocks without knowing that the reason behind such high performance. Sometimes you see a rise in stock prices due to the effect of the trade cycle. Once this trade cycle comes to an end, the stocks will show a downside. Hence, it is advisable to stick to your investment plan and improve your long term trend following system rather than obsess over performance. You can also refer to our blog “How to Overcome the Fear of Investing in the Stock Market” for help.

1. Letting Your Losses Accumulate: It is a general tendency of traders to hold on to a losing position in the hope that the stock prices will move up in future. They stick to their position rather than moving on to the next trade decision. This separates unseasoned traders from the experienced. The latter would exercise risk management strategies and put a cap on small losses.

1. Overconfidence Leads to One’s Downfall: A novice getting hit by beginner’s luck may get bolder and take bigger risks and then fail royally. What one needs to understand here is that trading is a very serious occupation and needs constant attention. Always be conscious of your decisions by remaining emotionally detached from success or failures.

Bottom-line:

Stock trading doesn’t need its participants to be financial gurus. Regular research and help from expert blogs or journals can turn anyone into a well-balanced player. By avoiding mistakes one has better chances of thriving as well as being successful in the stock market. You can open demat account with best broking firm. Good luck and happy trading!